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September 12, 2014 at 09:47 AM
The Financial Industry Regulatory Authority plans to consider at its Sept. 19 board meeting a revised recruitment practices proposal that looks to omit the controversial retention deal aspect of the original plan.
FINRA will consider a new plan on Sept. 19 requiring a recruiting firm to provide an educational communication to former retail customers of a transferring representative who are considering transferring assets to that firm.
However, “it appears that no consideration is being given to a rule in the area of retention deals,” notes securities lawyer Patrick Burns.
FINRA had previously approved and submitted to the SEC for final approval and adoption an earlier draft rule on the subject of recruitment packages.
But FINRA announced in late June that it had withdrawn that proposed rule to require brokers to disclose recruitment compensation paid to them as an incentive to move to a new firm, and planned to develop a revised proposal and file it with the Securities and Exchange Commission later this year.
